MauledAgain

It's Halloween. Somehow, without intending it, I have developed a MauledAgain tradition of focusing on this holiday each year that it rolls around. So I'm going to treat my readers yet again to some spooky thoughts. I might not have a ghost of a chance to amuse anyone or to make them laugh, but perhaps I can trick people into reading til the end.

In 2004, I looked at the idea of Taxing "Snack" or "Junk" Food. Those proposals seem to have melted away into the shadows of outright bans enacted by local governments on the use of trans-fats and other injurious food ingredients. But not seeing a ban on candy, I will let this issue settle in for a vampire's sleep. Please, someone, insert a stake through the heart of the dormant candy tax project. Let us not forget, chocolate is medicinal, and most state sales tax statutes exempt medicines from taxation.

In 2005, I had some fun with Halloween and Tax: Scared Yet?. Between trying to use every word associated with Halloween, and trying to find connections between various taxes and the tradition of dishing out candy, I managed not so much to scare people but to make them sick to their stomach, as if they had ingested 15 or 20 non-chocolate candy items.

In 2006, I simply lamented my inability to find four-pack versions of Reese's Peanut Butter Cups. In Happy Halloween: Chocolate Math and Tax Arithmetic, I noted that 2 double-packs isn't quite the same thing. It was a very short post. Imagine that! Perhaps the disappointment in my search for the ideal Halloween hand-out left me at a loss for words.

The recurring theme of chocolate, candy, and taxes has become the underlying skeleton on which different flesh is arranged each year in my Halloween post. Rather gory to picture, but each of us gets to build our monsters in our own peculiar way.

This year brings a double whammy. Once again, I failed to find four-pack versions of Reese's Peanut Butter Cups. I wonder if this is a shortage not unlike the ones in steel and cement, somehow triggered by consumption in developing nations. Is there some magic ingredient that is difficult to find? Was there a complaint filed by the manufacturers of those woefully small plastic Halloween pumpkin buckets carted by the smaller trick-or-treaters that noted the impossibility of fitting a Reese's four-pack into the child's candy accumulation device?

This year, for the first time since 2001, Halloween falls on a Wednesday. I won't be home when the first wave of treat-seekers arrives, because I will be teaching a tax course in the Graduate Tax Program. By the time I get home, most of the costumed characters will have passed through the neighborhood. Only a few sugar-starved college students from the university and some high school students holding on to one of the better experiences of childhood will show up after 8:15. But have no fear, ouch. I've left Reese's Peanut Butter two-packs with my neighbors, who will once again act as surrogate candy distributors for me. I simply need to remember to put up the signs that tell the masqueraders that a double treat awaits them across the street. In an almost unprecedented feat of memory, I not only remembered that I had signs from 2001, had saved them, and had put them in a particular spot but I also found them in that spot. I know I impressed at least one person with that eerie mental performance, and I even received free advice on how to affix one sign to the lamp post (something I'm sure I did 6 years ago but could not remember precisely how I had done so).

So now I wait to see if I purchased a sufficient number of two-packs. I live in fear that a youngster would be turned away by me because the inventory ran out. Horrors! Blessed with my mother's belief that no one should ever leave hungry, I purchase in bulk, adding 20 percent to the previous year's visitor count to determine how many to buy. I'd rather have some left over than to run out. Next year, I will try to remember to explain the demographics and the candy hunting styles of the groups that arrive at my door on Halloween. Perhaps by then I'll figure out what the tax issue is.

Drivers in Philadelphia, like those in other American cities, cope with increasingly slower traffic, growing congestion, longer travel times, more frequent back-ups due to accidents and break-downs, and a headlong rush into a looming permanent state of gridlock. The cause is simple. It's a combination of increased vehicle volume and inadequate highways. The conceptual solution is just as simple. Design some combination of decreased vehicle volume and increased highway capacity.

Decreasing vehicle volume requires a focus on one of the two causes of the increase. One cause, population increases, isn't very easy to change. It might be well nigh impossible. The other cause, an increase in vehicle miles, can be reversed through a careful mix of more attractive alternatives and stronger impediments to vehicle use. All elements of that mix would cost money to design and implement.

Increasing highway capacity also costs money to design and implement. Whether it involves building new highways, widening existing highways, fixing traffic signal timing, restructuring intersections, or changing traffic flow patterns through one-way street designations, elimination of on-street parking, or repaving, nothing much can be done without an infusion of cash.

So the congestion problem, no matter how it is alleviated or even solved, presents yet another instance in the long list of social problems that require us to answer the question, "So where do we get the money?"

Thus, it is not a surprise to read a story in Friday's Philadelphia Inquirer, one whose headline says it all: One Solution to Congestion: Local Taxes. The story explains that the Delaware Valley Regional Planning Commission released a study in which in concluded that a viable way to ease congestion would be to impose local taxes or fees. The Commission looked at 23 different taxes and fees, including a sales tax on fuel, cigarette taxes, liquor taxes, earned income taxes, general sales taxes, vehicle sales taxes, property taxes, tire taxes, hotel taxes, parking taxes, real estate transfer taxes, rental car taxes, leased vehicle taxes, vehicle property taxes, vehicle registration fees, vehicle title fees, access fees on commercial buildings near transit stops or highway exits, fees on all impervious surfaces, fees on rising property assessments in specific local districts, mass transit fare increases, tolls on local interstates and limited access highways, increases in existing turnpike and bridge tolls, and a vehicle-mile fee. The last one appears to be not unlike the mileage fee on which I most recently commented in Mileage-Based Road Fees, Again.

As a practical matter, the local governments in the Delaware Valley have little power to enact fees and taxes. The state legislature imposes all sorts of limitations on what the localities can do.

As an advocate of user fees, and as a supporter of the mileage-based road fee, I consider most of the fund-raising taxes and fees studied by the Commission to be inappropriate. There are all sorts of reasons for society to tax cigarettes, but financing travel is not one. The same can be said of earned income taxes, real estate taxes, hotel taxes, and general sales taxes. Some of the taxes and fees that appear more closely connected with highway use, such as vehicle title fees, vehicle sales taxes, tire taxes, and parking taxes, are unlikely to reach all highway users and would generate distortions in the financing of road use. Arguments can be made for new tolls and increases in existing tolls, but if a better alternative exists, why not use it? It makes far more sense to make the cost proportional to each vehicle's use of the road, and that is something the mileage-based road fee does.

One objection to user fees is the assumed inability of low-income and no-income individuals to pay them. The relief of poverty, though, ought not come through the disregard of user fees or the exemption of certain individuals from paying them, but through general assistance to persons who are unable to pay all sorts of expenses, not just user fees, and through increasing the employment marketability of the poor by providing qualified skills training and encouragement to enroll in that training.

In its report, the Commission asks, "Do local residents or local politicians have any appetite for new taxes and fees?" The Commission calls this a big question. Yes, indeed. A prevalent feature of postmodern culture is the notion that things can be had for free, that there is no cost, that if there are costs they should be shifted to others, and that taxes are per se evil. Some politicians have made careers out of those philosophies, and it appears not to bother them that the nation is deep in debt to other countries because of opposition to raising the revenue required to provide all of the things that voters tell their representatives they want society to provide.

The executive director of the Commission summed it up nicely. "I don't know whether people are feeling enough pain yet from traffic congestion . . . to feel that they are willing to support or fund [new transportation taxes.... In order for a larger audience to get behind it, they need to really feel the need and see that the funds are spent on local projects." In other words, taxes get public support when the public understands that the true, long-term cost of no tax or a smaller tax exceeds the cost of a new or increased tax. Sometimes, unfortunately, the realization comes too late. Hopefully that will not be the case when, one morning in the future, people find themselves stopped in traffic for eternity.

Yes, folks, chocolate has so many good qualities. It is medicinal. It tastes good. It has many culinary uses. And now comes news that chocolate can enhance the ratings received by a teacher on student course evaluations. According to Sweetening the Deal, an article that appeared in last week's Inside Higher Ed, a study demonstrated that higher scores on student course evaluations were attained when the students doing the evaluations were given chocolate. The title of the study, to be published in "Teaching of Psychology," is worth noting: "Fudging the Numbers: Distributing Chocolate Influences Student Evaluations of an Undergraduate Course." There's no doubt the same outcome would ensue if the study had focused on law students.

The study's authors became interested in the impact of externalities on evaluations when they were graduate students. They noticed that it was a fairly common practice for faculty to distribute candy to students when evaluation time rolled around. In the study, however, the candy was distributed by someone not otherwise connected with the course. In all three test groups, the half of the students getting the chocolate gave higher ratings on the evaluations.

The results do not surprise me. Nor am I surprised by the practice of some faculty of handing out treats. It happens. I've seen faculty have wine and cheese parties at the end of the semester, I've seen faculty bring in brownies, I've seen faculty bring in chocolate candy, and even, I, myself, once, a long time ago, when I was inexperienced and younger, brought in chocolate chip cookies that I had baked. I should not have admitted to being the baker, because students refused to eat them. It was near the beginning of the semester and I simply had made too many cookies. Perhaps they thought I was going to poison or sicken them. A tax guy making cookies? Impossible. Well, my friends and family know better even if my students don't. It's not as though students here don't like treats or object to chocolate. When, some years later, I noticed that the trays of brownies left over from the class preceding mine had been pretty much scarfed clean, I thought to myself, "Is it a gender thing? Somehow, men ought not bake, or admit to baking, chocolate chip cookies?"

It appears that in some instances the distribution of treats by law faculty is yet another attempt to soften the harsh realities of legal education, in part by persuading students that their teachers are not the ogres portrayed in Paper Chase. There is a good bit of "I want my students to like me" in all of this. Perhaps the desire to be liked is connected with a notion that the more a teacher is liked, the higher the evaluation scores. It's important, though, that a teacher be liked for the right reason, namely, that he or she is doing what needs to be done to educate the student and prepare the student for law practice. Unfortunately, much of what needs to be done to accomplish those goals doesn't create a fun-time, let's party, teacher-is-cool atmosphere in the classroom.

And that brings me back to evaluations. If, as I believe and some others do not, the task of the law professor is to prepare students for law practice, the best way of measuring the professor's teaching proficiency through student reactions is to canvass the students after they have graduated and practiced for a few years. It's amazing how much light the realities of the practice world can shed on a student's perception of a law school course. The ideal question, "Rate this professor in terms of his or her ability to prepare you for law practice," isn't one that a law student can answer, simply because a law student, even if enrolled in a clinic or externship for a few months, hasn't been immersed in law practice as a lawyer. Thus, the suggestion by one of the study's authors that evaluations be done several weeks before the end of the semester is unwise. The more of a course that a student experiences, including the final examination difficult though that may be, the more the student can appreciate what the course has or has not done for the student's learning development.

Yes, there are questions that ought to be asked of students. These are the questions designed to identify faculty who make racist comments, who throw things at students, who come to class late, who don't respond to student emails, and who otherwise are violating the terms of their contracts. It doesn't make sense to ask all the students whether there was a syllabus in the course, because the administration can figure that out for itself. The only possible reason to ask the question is to identify evaluations on which a student responds that there is no course syllabus when, in fact, there is one. Such an evaluation should be thrown out, and its responses ignored, because the answer calls into question the mental competence of the responding student. To the best of my knowledge, these evaluations are treated just as are the others. Scary, isn't it? The worst question is the "compare this professor to your other professors." Aside from turning the evaluation into a popularity contest --- does one get points for bringing in goodies?--- this question does nothing to determine the teaching competence of the faculty member as measured against a standard. The numbers available for answering that question have no meaning. Is someone getting a "2" twice as good a teacher as someone getting a "1" and does getting a "5" mean that the person is perfect? It matters because some faculty and administrators put all sorts of value on the responses. Fortunately, other administrators and faculty give these things the weight they deserve.

Speaking of weight, I wonder how many pounds of chocolate are sufficient to increase evaluation scores. And should it be packaged in brownies, cookies, candy bars, or as coffee flavoring? Should alternative treats be available for the unfortunate few who dislike chocolate or who are allergic to it? Perhaps someone will conduct follow-up studies. In the meantime, another suggestion from one of the study's authors makes sense. Treats should not be handed out with evaluations. I'd go further. They ought not be handed out during the evaluation period, and ideally, ought not be handed out at all.

Yes, it's another story of corruption and institutional mismanagement. In Seaport's Carter Asks for Leniency two Philadelphia Inquirer staff writers explain how John Carter, former head of the Independence Seaport Museum in Philadelphia, has reacted to his conviction on two counts of mail fraud and one count of tax evasion. Carter pled guilty in June.

According to theCriminal Information filed by the federal government, Carter was charged with defrauding the museum of more than $1,500,000. He caused the museum to pay for a root canal, calling it "boat supplies," to pay for a new roof, describing it as "caulking" for one of the museum's boats, to pay for jewelry and clothing, describing them as "supplies" for the boat, to pay for other clothing, describing it as "uniforms" for the crew of a museum boat, to pay for gym fees, classified as a "meetings" expense, and to pay for all sorts of other things described as connected with museum activities and property. He allegedly used museum funds to pay for a $210,000 house, a $275,000 boat, another $100,000 boat, a $6,900 bed, a $1,700 expresso machine, a $50,000 work of art, $50,000 of electronic equipment, and all other sorts of things. Apparently, the museum's oversight of its top executive was "inadequate," and Carter allegedly knew it. During the period in question, Carter received a $301,000 salary and lived in a townhouse owned by the museum, for which he paid no rent.

Recently, Carter sent a letter to the judge responsible for the sentencing, attempting to persuade the judge to go easy on him. He claims he wasn't the only museum employee doing what he did. He claims that members of the board and donors were part of what Carter's lawyer called a "culture of corruption and self-dealing." According to Carter, these people "exploited the museum for questionable tax breaks and stuck it with the bill for lucrative no-bid contracts, expensive parties and pricey boats." The chairman of the board denies Carter's allegations.

Carter justified his actions by claiming that after seeing others do the same thing, he imitated them to get "my fair share." He points out that his parents were alcoholic and abusive. He notes that his health is bad and his wife has filed for divorce. He asks why the board didn't fire him, and then answers his own question by claiming the board inadequately supervised him.

Carter filed letters written by his daughter, other relatives, friends, and business associates. They claimed to be "confounded" by what Carter did. Carter says he "can hardly believe it himself."

Carter is arguing for a sentence of no more than four years. The prosecutors take the position the sentence should be 19 years.

So a fellow defrauds a non-profit organization he was hired to protect. He does not report the illegal income on his tax return as the law requires. He is caught. He pleads guilty. He expresses bewilderment at what he did. He justifies his actions on the grounds others were doing it, cites the challenges of his childhood, health, and marriage, and then suggests that somehow had the board fired him as it should have done the problem would not be so severe.

The most telling part of the entire story is this. Carter made a deliberate decision to defraud the organization in order to get "my fair share." The scheme, though not brilliant, was carefully designed to hide personal expenditures as costs properly chargeable to the non-profit organization. What I would like to know is how Carter computed his "fair share." That would help the rest of us compute ours.

With so many of my posts devoted to tax law commentary and opinions about legal education, rarely do I give much attention to genealogy. Today, however, I consider the news that Barack Obama and Dick Cheney are related.

This revelation has sparked some surprising reactions, ranging from advice to Obama that he be "sick to [his] stomach" to "It can't be !!!!!" Why not? How is it possible that people do not understand that each and every one of us is a cousin, to some degree, to every other person who is alive today or who has ever lived. Admittedly, documentary "proof" of a specific connection sometimes is difficult or impossible to find (as is the case with one connection I'm trying to document), but DNA analysis cements a conclusion that has long been known.

One of the comments claims that the connection between Obama and Cheney means that they share only 0.39% of their genes. That computation, though, assumes that there is only one link between the two men. There is more than one link. A little bit of arithmetic tells us that each of us has 2 parents, 4 grandparents, 8 great-grandparents, and so on. Yet as we reach further back into our ancestry, computing larger and larger numbers of ancestors, the available population becomes smaller and smaller. The explanation is that all of us share a fairly limited number of ancestors, and if one subscribes to certain theologies, all of us descend from one pair. The term "human family" is more than a conceptual notion.

So what's the big deal that Obama and Cheney are related? The disbelief and disdain expressed in some of these comments suggests something more than the dawning of an intellectual revelation. Among the insults and expressions of sympathy are elements of disgust and even hate. I cannot imagine the reaction to the discovery that Obama and George W. Bush are 11th cousins.

The Obama-Cheney connection came to my attention last week when my brother-in-law emailed me a link to the story. In the email he asked, "Any chance the Maule family is related to Obama and Cheney?" The answer is, yes, we're related. And so is your family. And, hey, your family is related to my family. The more challenging question is, "Can you prove, with documents and other acceptable evidence, the actual link between a member of the Maule family and Obama or Cheney?" Knowing that I have established my specific relationship with 23 of the nation's 43 presidents, my brother-in-law probably intended to ask the latter question. As an aside, I've since discovered the links to William Clinton, so the presidential count is now at 24. Someday I'll update the web page. As another aside, my webpage showing my relationship to the presidents is cited as a source for Wikipedia's List of United States Presidents by genealogical relationship.

As for Dick Cheney, he and I share many ancestors, the closest being Gospatric, Earl of Northumberland and Dunbar, though it appears we descend from different wives or consorts of Gospatric. See Ancestry of Richard Bruce Cheney by William Addams Reitwiesner. See 26-GENERATION ALPHABETICAL ANCESTOR LIST for JAMES EDWARD MAULE, which does not show the ancestry in steps, as that part of the ahnentafel is not yet ready for the web page. What does that make us? Roughly 28th cousins. We both descend from Gospatric's great grandfather, Ethelred II, King of England.

As for Barack Obama, he and I share many ancestors, the closest being Nathaniel FitzRandolph and his wife Mary Holley (or Holloway). See Ancestry of Barack Obama, also compiled by William Addams Reitwiesner. See AHNENTAFEL FOR GENERATIONS 1 THROUGH 13 for JAMES EDWARD MAULE. What does that make us? Obama is my eighth cousin twice removed.

Before I forget, let me express my thanks to Mr. Reitwiesner. He found for me a link to Woodrow Wilson, through the FitzRandolph family, so now the presidential count is at 25. And his research shows that I am a fifth cousin four times removed to James Longstreet, the Confederate General, sixth cousin three times removed to Woodrow Wilson, eighth cousin once removed to Georgia O'Keefe (so she joins Maxfield Parrish in the cousin list), ninth cousin to Loudon Wainwright III, ninth cousin to Buster Crabbe, ninth cousin to Birch Bayh, Jr., and fifth cousin three times removed to Theodore Vail, founder of AT&T. In turn, Birch Bayh III is my ninth cousin once removed, and JonBenet Ramsey is my ninth cousin twice removed.

What fun this is. Yes, it has no end, but this post must end. It will end with one more connection between Dick Cheyney and myself.

When Dick Cheney accidentally shot Harry Whittington, he shot a man whose daughter Sally Baker Whittington had married Gordon David May. I am Gordon's sixth cousin once removed. And, no, I'm not going to try to figure out the relationship between Dick Cheney and Harry Whittington. I'll leave that to others. I need to turn back to tax law.

Paul Caron's TaxProf Blog post on the ranking by the Princeton Review of law student study time inspired me to do some arithmetic. Nothing as complicated as a tax return, but some multiplication and division with a twist.

According to the rankings, Cornell law students top the list with 5.97 hours per day of study, and North Carolina Central law students rack up a mere 2.52 hours per day of study. Villanova students, I must add, were tied for fourth place, with a reported 5.5 hours per day of study. According to the Princeton Review, it obtained data from 18,000 law students at 170 law schools, which means that they polled, on average, slightly more than 100 students per school. That's a significant percentage, probably in the range of 15 to 25 percent, far, far more than the small samples used by Gallup and other pollsters that have statistical significance.

Here's the twist. Are these hours per school day, hours per week day, or hours per all days in the week? Using the most generous interpretation, Cornell students put in roughly 42 hours per week of study, whereas North Carolina Central students put in roughly 18. Villanova students invest roughly 38 hours per week.

Here is the important question. Is this enough? Rankings are fine, but don't mean as much as a measurement against a standard. Recall my comment in Yet More Reasons to Dislike Grading Curves, "the best measure is a comparison of performance against a standard." A person who studies one hour a week more than any other student might be in first place, but might still fall short of what is required.

In one of my law school newsletter columns, Time CAN Be on Your Side. Or at Least by It, I told an anecdote about the reaction of a student to my in-class explanation that a 3-credit law course required, on average, an investment of 10 hours a week of study outside class. When I wrote the column, I polled my colleagues to get a sense of what they thought, because my estimate reflected a combination of what I had been told as a student and what I had heard told to students by my colleagues in the past. Somewhat to my surprise, my colleagues reacted unanimously when they shared their perspective. Unanimity on a law faculty is not an everyday event. So it was with an even higher level of confidence that I wrote:

Put it all together and it adds up to somewhere between 2 to 4 hours of out-of-class time for a 50-minute class session. Hence the conclusion of roughly 10 hours per week for a 3-credit course. For a student enrolled in 14 credits of courses, that’s 45 hours per week outside of class. Add in the 14 hours, and it’s, what? FIFTY-NINE HOURS A WEEK? That is OUTRAGEOUS.

But is it really that outrageous? Maybe, for students accustomed to putting in far fewer hours per week in their previous educational experiences. The better comparison, though, is law practice. Ask practitioners how many hours per week they devote to their profession. For many, 59 hours would be on the lower end. If the firm demands 2,300 annual billable hours, well, you do the arithmetic. And while you’re at it, ask those practitioners if they think 50 to 60 hours per week for law school academic endeavors is unreasonable.

According to this generally accepted standard, if the average law student is carrying a 14-credit-hour course load, the ones at Cornell are pretty much investing the time that should be investing, and Villanova students aren't too far behind. But somewhere along the line law students carry more than 14 credit hours, because most schools require more than 84 credit hours for graduation. Many set the requirement in the high 80s, and a few in the low 90s. The average, therefore, appears to be closer to 15 credit hours than 14. This means none of the law schools report an average that meets the standard.

Averages, though, mean little. The determination to allocate time to law studies or to some other activity is a personal one. A student who invests a low number of hours does no less damage to his or her academic prospects simply because his or her classmates are racking up a high average. Conversely, someone at a school where the average time investment is woefully low can enhance his or her chances for academic success by finding ways to focus on law studies for more than 6 hours a day.

Law students, not surprisingly, complain about workloads and argue that the standard is unattainable. It's not. Quoting again from Time CAN Be on Your Side. Or at Least by It:

Time as an enemy seems more the case than time as an ally. Time, though, is neither. It simply is a resource. But it is, like most resources, finite. Like any resource, finite or otherwise, it needs to be used well. Efficient use of resources is an acquired skill. Law students are accused by practitioners of graduating with poor time management skills. Not that practitioners don’t accuse each other, and sometimes themselves, of the same deficiency.

So how do you manage time? Simple. You budget your time and then you adhere to the budget. The first part is easy, the second is difficult. It requires discipline of a sort that brings to mind the word rigor.

In Time CAN Be on Your Side. Or at Least by It, I give law students advice on how to devote 60 hours a week to their law studies, sleep 8 hours a night, and still have 8 hours a day remaining for the other activities of life. More specifically, I give them advice on how to figure out how they can attain those goals. I also explain how law faculty, over the ages, came to the conclusion that roughly 3 hours per week outside of class is appropriate study time for each credit hour of class time.

It's good that attention has been given to the issue of study time for law students. Perhaps they will read Time CAN Be on Your Side. Or at Least by Itand make adjustments. College students who are thinking of attending law school and those who have committed to attending law school should read the advice. It will be interesting to see what Princeton Review reports a year or two from now.

More than a year ago, in New Pennsylvania Tax "Reform" Doesn't Add Up, I analyzed Pennsylvania's property tax reform legislation. Although I was far from impressed with the legislation in its entirety, my comments on one aspect reflected the opposite conclusion:

Under the legislation, senior citizens currently eligible for property tax relief through income tax credits will qualify for larger credits, in other words, more property tax relief. To their number will be added more senior citizens, because the income cut-off for this relief will be increased from $15,000 to $35,000. There are many retirees earning between $15,000 and $35,000 for whom property taxes are a severe burden. This part of the legislation is a worthwhile, and even noble, objective.

The relief, as I also pointed out, would not be triggered until the state began receiving revenues from casino operations.

Now State Representative John Perzel is introducing legislation that would use casino revenues to finance real property tax relief to senior citizens. According to Perzel's news release, his Older Pennsylvanian Property Tax Elimination Act, which carries the interesting acronym of OPPTEA, would eliminate the real property tax for homeowners aged 65 or older whith incomes of $40,000 or less. Unfortunately, I have not been able to find the text of the legislation. Thus, I don't know what Perzel means by "income." Is that Pennsylvania taxable income? Federal adjusted gross income? Some sort of modified adjusted gross income that includes tax-exempt interest? There are all sorts of "incomes" and some do not truly measure a person's economic status or ability to pay real property taxes.

According to this Delco Times story, some legislators are jumping on the OPPTEA bandwagon. Others have withheld judgment, until they "see it," a comment that suggests that I am not alone in my quest for the legislative language. It would not surprise me that the legislation has not yet been drafted and that there is no language.

Perzel plans to have "eligible seniors" send their real property tax bills to the state Department of Revenue, which would send a check to the school district. That does seem a bit less complicated than having senior citizens file for refundable credits on their state income tax returns. Presumably the Department of Revenue would cross-check the applicant's eligibility by looking at state income tax returns. How, though, does one distinguish a senior citizen who has not filed a tax return because she has no taxable state income from one who has not filed because he or she forgot to file or is evading taxes?

It is not clear if the funds that Perzel wants to use for this plan are the same as, or in addition to, the funds already earmarked for general real property tax relief. The Delco Times story quotes legislators who think the former and who think the latter. Again, there is a reason that legislative proposals are easier to analyze when the text of the legislation is available. It's more likely people can figure out what the proponent really wants to do.

Several years previously, in Killing the Geese, I addressed the issue in broader terms when a since-derailed plan to replace the property tax with loca earned income taxes and increases in the real property transfer tax was being touted as the remedy:

Yes, the real property tax poses a problem for people whose incomes are fixed and whose homes continue to increase in value. Real property taxes for these folks increase while their income doesn't. But let's look more closely. Is it really such a HARDSHIP if a person pulling down $300,000 in pensions and investment income needs to cope with a $400 real property tax increase? On the other hand, someone scraping by on social security and a small pension finds a $250 increase taking a meaningful chunk out of a $15,000 annual income. And let's not forget that a significant number of elderly no longer own homes, and in some cases, never owned homes.

The cry that real property taxes hurt the elderly is as misleading as the silliness the late Rep. Claude Pepper rode to fame. His mantra that "the elderly are poor" led to a shift in government outlay allocation that has left us with a nation in which poverty is rampant among children. The simple fact is that a person's age should no more be used as a measure of their economic status as should their hair color or lack thereof. And, of course, there are people who cannot be classifed as "elderly" for whom real property tax increases are a serious burden, though most young poor don't have the opportunity to own real property.

So the relief ought to be provided to those who need it, namely, the poor. This is what has been done with the state income tax. True, the definition of "poor" can and will fuel some debate, but it can be resolved.

In some respects, the issue has come full circle.

Property taxes are a burden to some citizens of Pennsylvania but they are not an unreasonable burden to all of them. They may be disliked. They may be an aggravation. They may be used to finance school programs with which some taxpayers disagree. But they are a serious impediment to homeowners on relatively low fixed incomes, who find themselves unable to buy necessities such as food and medicine because they need to pay real property taxes to avoid losing their homes.

So one question is why people under the age of 65 who are on fixed incomes and facing the risk of losing a home when real property taxes increase are ineligible for assistance? Think of the person on a social security disability pension, or receiving a small monthly amount from a structured settlement on account of a disabling injury. Ought not they, too, be helped? What's so magical about 65? Is it not an arbitrary number holding even less correlation with reality than 16, 18 and 21? In other words, it has become increasingly apparent, from recent scientific studies, that age alone tells us little or nothing about a person's pyschological, financial, intellectual, or emotional state.

Under the current plan, which will go into effect whenever the casino revenues begin to flow into the state treasury, property tax relief is shared by all homeowners, and amounts to a small, several hundred dollar, reduction in bills that often are in four, and sometimes five, digits. Perzel and several of the legislators who support OPPTEA think it makes more sense to eliminate the tax completely for senior citizens rather than make miniscule reductions in the real property tax bills of all homeowners. I'm not certain I agree that real property taxes ought to be totally eliminated for all senior citizens with incomes of $40,000 or less. There's no reason that they ought not be charged some small amount that remains fixed. Why do I think this? One of the legislators quoted in the Delco Times article points out that real estate taxes are a burden even for some senior citizens with incomes exceeding $40,000, because in some instances the tax bill amounts to 20% or more of their income. If senior citizen homeowners were required to pay a fixed, relatively small real property tax, it would be possible for senior citizens in the $40,000 to $50,000 income range to obtain some relief.

There is another technical problem with Perzel's bill. What happens if a senior citizen with "income" of $39,500 in year one, who benefits from total elimination of the real property tax, incurs an income increase of $600 in year two? This person would now be responsible for the entire real property tax bill, perhaps as much as $3,000, $5,000, or even $10,000. Those expert in drafting tax legislation call this a "cliff" provision. One extra dollar of income and the entire benefit disappears. Would it not be better to scale the relief? For example, senior citizens with "income" of $10,000 or less would get full property tax relief, or perhaps be required to pay $100. Seniors with incomes exceeding $10,000 would receive partial relief, receiving a decreasing amount of relief, that is, a smaller check on their behalf from the Department of Revenue to the school district, as their incomes increased. Thus, a $600 increase in income might translate into a $50 or $100 decrease in property tax relief and not a total elimination of the property tax relief.

Presumably, the amount of property tax relief for a particular real property tax year would be based on the senior citizen's "income" as reflected on his or her income tax return for the previous calendar year. It is difficult to imagine how any other arrangement could be administered in a sensible way.

Until one can figure out what Perzel means by "income" it is difficult to give these suggested improvements with more specificity. So here's an invitation to John Perzel: you are welcome to share with us the legislative text of your proposal. Let's see what it is that you are proposing, in specific rather than general conceptual terms.

I've commented previously on the ever-changing adventures of Wesley Snipes as he responds to tax fraud accusations. I started with The Tax Fraud Environment: Sniping at the Congress, and followed with Namibia: A Different Sort of Tax Haven? and The Snipes Tax Trial: A Circus in the Making?. Thanks to Paul Caron's TaxProf Blog for the heads up on the latest developments in the Snipes case.

According to the Ocala Star Banner, Snipes fired his attorney, and replaced him with Robert Bernhoft of Milwaukee, who then asked the court for a continuance. Bernhoft requested time to prepare the defense, and claimed that Billy Martin, the lawyer fired by Snipes, had committed "pretrial preparation failures." Martin disagreed, and in turn alleged that the firing was "a ploy" to obtain a continuance. The judge in the Snipes case also referred to the continuance motion as a ploy, asking Snipes and Bernhoft why they had not filed professional ethics complaints against Martin. One of Snipes' co-defendants, who represents himself, and the attorney for the other both agreed that a continuance was in order. The judge also was concerned that several continuances had already been granted in the case.

Shortly thereafter, according to this Hollywood Reporter story, the judge relented and granted the continuance. What changed his mind? He met with Snipes and was persuaded that there were "issues" between Snipes and Martin and that justice would be served by the continuance. Nonetheless, the judge made it clear that there would be no more continuances. The trial, originally set to begin on October 22, will now begin in January.

Martin has another famous client, one Michael Vick, who he represents in federal dogfighting charges. Bernhoft previously represented Snipes in a criminal paternity case, and succeeded in having the charges dropped. Neither attorney appears to restrict his caseload to tax work, which certainly cuts against the stereotype that lawyers are of two types, tax practitioners and anything-but-tax practitioners. Particularly in the area of criminal tax fraud defense work, it is not all that unusual to find the attorneys also representing people charged with crimes not involving tax matters.

Bernhoft has several very visible successful tax fraud defenses to his credit. He represented Joseph Banister, the former IRS agent, and Vernice Kuglin, the Federal Express pilot, both of whom had been indicted for failure to file federal income tax returns and to pay federal income taxes. He also obtained acquittals of 17 defendants in a trial more than a decade ago. He succeeded in the Kuglin case because he was able to persuade a jury that Kuglin's letters and inquiries to the IRS asking about the validity of the income tax corroborated the defense assertion that she wasn't trying to hide anything. The favorable verdict in the Banister case rests both on an arguably weak government case and the defense's ability to persuade the jury that the defendant genuinely believed that the income tax is invalid.

Bernhoft has an interesting tax history. On July 27, 1999, the United States District Court for the Eastern District of Wisconsin adopted the recommendation of the federal magistrate that the court grant the government's motion for summary judgment and its petition for a permanent injunction against Robert Bernhoft and Robert Raymond, prohibiting them from engaging in any and all of the following activities:

1. Inciting other individuals and entities to understate their federal tax liabilities, avoid the filing of federal tax returns, or avoid paying federal taxes based upon (a) the false representation that wages, salaries, or other compensation for labor or services are exempt from federal income taxation, or (b) any other such frivolous claim with respect to the scope of federal income taxation, or (c) any false or fraudulent claim regarding the allowability of any deduction or credit, the excludability of any income, or the securing of any other tax benefit for federal income tax purposes;

2. Advertising, marketing, or selling any documents or other information advising taxpayers that wages, salaries, or other income not specifically excluded from taxation under Title 26 of the United States Code are not taxable income;

3. Providing forms for or assisting any individual in the preparation of false Internal Revenue Forms W-4, W4E, 1040X, and any other form, return, or declaration claiming that the taxpayer is exempt from federal income taxation or entitled to excessive withholding allowances;

4. Filing, providing forms for, or otherwise aiding and abetting the filing of frivolous Freedom of Information requests with the Internal Revenue Service; and

5. Engaging in any other conduct subject to penalty under Section 6700 of the Internal Revenue Code, Title 26 of the United States Code.

When the defendants appealed, the decision was affirmed, and the Supreme Court refused to take the case. Raymond v. U.S., 78 F. Supp. 2d 856 (E.D. Wisc 1999), aff'd, 228 F.3d 804 (7th Cir. 2000), cert. denied, 533 U.S. 902 (2001).

It appears as though Bernhoft has switched gears, given up on marketing tax protest materials, and turned to taking on high profile tax fraud cases. He seems adept at getting juries to acquit tax fraud defendants. Of course, what isn't known is how many clients have pled guilty or otherwise failed in their attempts to escape the charges. It will be interesting to see how he fares in the Snipes case. Because of the continuance, we must wait a little longer. Hopefully the delay will improve the chances for the correct outcome, whatever it may be. But before the outcome is known, surely a variety of significant evidence will be brought forward. This story is far from over.

A colleague sent me an email the other day, and it added to the list of reasons I want to teach the first-year property course. The email referred me to a story and came with an introductory tag line: "Talk about great exam questions!" Oh, indeed, there are. It's true, we law faculty don't need to make things up when we need hypotheticals. The world just keeps on giving.

The story has been reported in more than a few places, but the email that sent me to the BBC America version. Though the BBC titled its piece "North Carolina Pair Feud over Leg" I think "Tales of the Lost Leg" has a better movie title ring to it.

The facts are fairly simple, if not very bizarre. After he was in a plane crash, John Wood's leg was amputated. He kept the leg so he could be "buried as a whole man when he died." He put the leg into a barbecue smoker and then put the smoker into a storage facility. For some reason, Wood stopped paying the rental fees for the storage facility, so the storage company seized the storage locker contents and sold them at an auction, using the proceeds to pay Wood's storage fees. The purchaser of the items, Shannon Whisnant, looked inside the smoker and found the leg. He gave it to the police, and after determining no crime had been committed, they handed it off to a funeral home so that Wood could retrieve it.

In the meantime, Whisnant was collecting money from people willing to pay to look inside the empty smoker. That inspired him to ask the funeral home for the leg. The folks there refused, so Whisnant approached Wood and proposed joint custody of the leg, with a sharing of profits. Wood rejected the offer and demanded the return of his leg. Whisnant threatens legal action if the leg is not returned to his possession, claiming he has a receipt for its purchase. According to this more recent report, Wood and Whisnant have agreed to take their case to the Judge Mathis show, and were scheduled to tape the episode last Friday. According to this story, the leg is not at the funeral home, Whisnant says he doesn't have it, and also says he has an idea where it is.

Most folks who haven't been to law school would ask, "OK, so who gets the leg?" Perhaps some lawyers would simply ask that question. But there are all sorts of questions that need to be answered. For the moment, assume that the contract between Wood and the storage company was valid and enforceable, and that there were no improprieties with respect to the auction at which Whisnant made the purchase.

Here are the questions that need to be answered:

1. Did Whisnant obtain legal title to the leg by purchasing the contents of the storage locker even though neither he nor the storage company knew the leg was in it?

2. If so, are there any statutes barring the sale of body parts that would invalidate the alleged sale?

3. Did Wood's storage of the leg in the locker violate any health or safety ordinances or similar laws?

4. If so, does the violation keep the leg out of the bundle of contents that the storage company was permitted to sell?

5. Did Whisnant abandon title to the leg when he transferred it to the police?

6. Did the funeral home undertake any fiduciary responsibility to Wood when it took possession of the leg?

7. How much of the amount paid by Whisnant for the bundle of property sold by the storage company is allocable as his tax basis in the leg?

8. If Whisnant is held not to own the leg because he transferred it to the police, is he entitled to a loss deduction equal to his tax basis in the leg?

9. If Whisnant is held not to own the leg because he transferred it to the police and is not permitted to claim a loss deduction, is he entitled to a charitable contribution deduction for the value of the leg?

I am certain there are more questions. For the moment, those are enough to keep any law student writing for an hour or two.

As to the outcome: Forgive me, but it seems Whisnant ought to let Wood have his leg, no matter what "the law" might say. Whisnant has one motive, and only one motive, namely, money, and he's trying to bank not on his own efforts and contribution to society but on the misfortunes of another person and the unexpected inclusion of an amputated leg in a bundle of items purchased at an auction. Even if Whisnant is poor, the decent thing to do is to back down. Now I need to go find out what Judge Mathis decides.

If you are wondering where all the puns and word plays are, I've been nice and resisted the temptation. Actually, I've been trumped. A marvelous use of a variety of anatomical terms and leg-related words, not unlike my style of toying with the language, appear in the "What kind of sauce would you like on that?" account of the story on the Crooked Paws Retreat blog. Yes, you read that right.

All I'll say is that when Thanksgiving, which is less than two months away, finally rolls around, I'm going to be ready with all sorts of tales (ouch) when someone (probably me) is carving the turkey and says, "Who gets the leg?" Well, I'll also say that I might be risking access to the dessert table if my smart-aleck comments get people's noses out of joint.

Yes, indeed, I detest grading curves. Supposedly they make life easier for graders, but in the long run they are deceptive. For me, the best measure is a comparison of performance against a standard. If there is some reason to rank students, they can be ranked in accordance with their accomplishments scored as a percentage of what could have been done. To restrict the A grade to an artificial percentage of a class is wrong for two reasons. First, it makes some students appear to be less accomplished than they are simply because their scores are a tad lower than the lowest score in the selected percentile. Second, it can make unaccomplished students appear more competent than they are because someone needs to be in the top x%. Grading curve defenders will point to the various exceptions and wrinkles that accompany curving rules, to demonstrate that "when appropriate" a grader can reduce the number of A grades or even eliminate them entirely. That's not enough.

The goofiness of grading curves surfaced recently in Marquis v. University of Massachusetts. Brian Marquis, a student enrolled in the University of Massachusetts College of Social and Behavioral Sciences, sued the university, some of its officials, the chair of the Philosophy Department, and a teaching assistant, because the teaching assistant lowered Marquis' grade based on a grading curve. According to the complaint, Marquis enrolled in Philosophy 161, Problems in Social Thought, taught by Jeremy Cushing, a teaching assistant. On the first day of class, Cushing distributed a syllabus that explained the grading policy:

Each exam will be worth 25% of the final grade for a total of 75%; The response papers will be worth a total of 20% (or 5% each). Each paper will receive a number grade (from 0-5) in .5 point increment; The remaining 5% is for participation in class.

Marquis finished the course with response paper scores of 5, 4, 4, and 4.5, for 17.5% out of 20%. His exams earned 23, 22.5 and 19.5 out of a possible 25%, for a total of 65% out of 75%. He earned 5% for class participation. His total score of 92.5% 'translat[ed], by universally accepted standards, into an A- letter grade." The complaint did not explain who set the "universally accepted standards" for converting percentages into letter grades.

When, after the semester, Marquis looked up his grade on the university's data system, he saw that a grade of C had been entered for the course. He contacted Cushing and asked for either an explanation or a re-evaluation. In his response Cushing wrote, "This brought your final grade to an 84 for the class. The numerical grades were on the high side .. but I thought your grade (of C) was a good reflection of your work. To make the grades more representative of student performances, I set a curve (or, more accurately, I drew up a new grade scale). There were two other students that had grades in this range, one with an 83.5 and one with an 84.5, both of these students also received a grade of C. In your case, the grade assigned by scale seemed to fit." When Marquis complained to the University Ombudsman, she replied, "I would urge you to accept this grade and continue on with your course work as these are no grounds for an academic grievance. For example, 84 points could range anywhere from a 'C' to possibility an 'A-,' at the extreme end."

Marquis alleged that Cushing's grading was arbitrary and capricious. He alleged that when he applied to graduate schools he would be disadvantaged, because C grades are viewed unfavorably by graduate programs, in part because they suggest the student is lazy and inattentive to studies. He alleged that the grade pretty much squashed his chances of getting into graduate school.

Marquis rested his case on several grounds. He alleged violations of the Massachusetts Consumer Protection Act. He alleged violation of his First Amendment rights because the ombudsman shut down the grievance procedure. He alleged violation of the Fifth Amendment because he was denied a chance to appeal and because the grading infringed on his rights by taking of liberty and property without due process. Marquis also alleged breach of contract and breach of special relationship. He added allegations of reckless action, conspiracy, deception, interference with civil rights, promissory estoppel, intentional infliction of emotional distress, and tortuous interference with economic advantage. He sought certification of the litigation as a class action.

In their Memorandum in Support of Motion to Dismiss, the defendants argued that Marquis had failed to state a claim upon which relief may be granted, had ignored existing judicial authorities rejecting many of his specific claims, had not followed specific procedural prerequisites for certain claims, had not demonstrated a contractual relationship with the individual defendants, and failed to allege facts supporting his tort and constitutional claims. The defendants argued that a course syllabus does not create binding contractual rights. They also alleged Marquis had not completed service of the complaint within the required time.

According to this Boston Globe story, District Court Judge Michael A. Ponsor dismissed the suit. Marquis has indicated he is considering an appeal.

On the law as it stands, the court was correct. Unfortunately, the law provides no useful remedy, in fact no remedy, for students harmed by the sort of situation Marquis encountered. It is unfortunate that "the law" leaves students at the mercy of educational institutions, aside from obvious instances of racial, gender, religious, or similar discrimination.

Of course, if educational institutions did things the way they should be done, these sorts of issues would not arise. The Marquis case is not an instance of a student who is unjustifiably unhappy with his or her grade. It involves a serious grading problem.

Let's treat the case as the court had to treat it, namely, we must assume that the facts alleged by the plaintiff are true. As best as I can tell, the defendants did not dispute any of the facts that bear on my criticism of what happened.

Cushing gave the students a partial explanation of how the course would be graded. To his credit, he did more than some teachers, especially college and university faculty, provide in this respect. What he omitted, of course, was the connection between the acquired percentages and the letter grades. One might assume that a 100% earns an A, but after reading what happened in the Marquis case, I'm unwilling to make that assumption. The response of the ombudsman to Marquis suggests that there is very little correlation between the level of achievement measured against a standard and the letter grade assigned by the grader. Professional educators tell us that a good grading system lets the students know what is expected and what grades can be earned when a student performs at a particular level. My students know that I have a benchmark, that roughly 75% or better is equivalent to an A, that 20% is the minimum to earn a passing grade, that roughly 50% is equivalent to a C. The law school has in place a policy that requires faculty to explain the bases on which grades in a course are earned. Thus, faculty must explain if the grade is based entirely on an examination, a paper, semester exercises, presentations, or some combination, and whether and how class participation affects the grade. Faculty are not required to explain how performance translates into a letter grade, though a few of us do provide that explanation.

Cushing then altered the grading system without notifying the students. What appeared to be a 92.5% became, somehow, and 84%. Professional educators agree that this is a terrible thing to do. To leave students thinking that their total scores will be based on a published explanation but to use a different grade scale without telling the students is appalling. Perhaps the law has no remedy, but ought not educational institutions, especially huge universities that have education departments, think twice about the adverse ramifications of faculty engaging in this sort of changing rules in the middle of the game?

Cushing claims he set a curve, or, more accurately, drew up a new grade scale. Nowhere in his explanation on the course syllabus does he mention a curve. Yes, he threw his students a curve ball when he introduced the curve. Was it really a curve? In a sense, yes, it was. Why did he not inform the students at the outset that he would be doing this? I have an idea, and I'll get to that in a moment.

Cushing gives as one reason for altering his grading his intent or attempt to "make the grades more representative of student performances." If an 84 or a 92.5 is a C, that leaves very, very fine lines between the C and C+, the C+ and the B-, the B- and the B, the B and the B+, the B+ and the A-, and the A- and the A. Even if the only grades are C, C+, B, B+ and A, that's a lot of line drawing to squeeze into a small numeric range.

The other reason is that "[t]he numerical grades were on the high side." So? High scores could mean that students learned more than was expected, or somehow figured out how to do a better job writing exams than did previous students. They could mean that a disproportionate number of very bright and high achieving students enrolled in the course for this particular semester. Cushing's explanation, though, suggests that what happened was that he over-valued responses and assigned more points than hindsight would admit. Well, that happens. The solution is to get better at designing exam questions and assignments, and to learn more about grading. The solution is not to change the benchmarks in the middle of the course, or after the exams and assignments are completed.

Students don't realize it, but designing examinations, semester exercises, assignments, and problems is a very challenging task. If the question inadvertently reaches too many issues, or if there are insufficient facts, or if the analysis requires students to know something beyond the scope of the course, the measurement of student achievement will be skewed. Good testing requires an understanding of what the course is designed to do, and requires that the tester have specific goals in mind with respect to each question or problem. This is something that professional educators learn in their education courses.

What Cushing did is typical of the tribulations afflicting first-time teachers who do not have education degrees (and perhaps some who do). Cushing is a teaching assistant. I wonder if anyone was mentoring him with respect to examination, testing, and grading. In many respects, the institution failed Cushing no less than, and probably more than, Cushing failed the institution and the students. Universities throw graduate students into teaching roles because they're inexpensive, and because their use frees up faculty for research and other activities not directly connected to teaching. So long as the law turns the other way when students suffer because of institutional inadequacies, the quality of higher education in this country will continue to suffer.

Grading curves hide a lot of errors in examination design, defects in questions, flaws in scoring, and shortcomings in converting scores to letter grades. Grading curves provide an excuse behind which faculty can hide. Grading curves distort the evaluation of student work. The problems in the Marquis case go way beyond grading curves, and yet grading curves took center stage because the grader resorted to one when the rest of the evaluation system broke down.

When speaking in opposition to grading curves, I use an analogy that curving advocates have yet to negate. If 30 people enter a race, and 10 of them run a mile in fewer than 4 minutes, so be it. If the benchmark for an A is a 4-minute mile, and if in past and future races, only 3 or 4 runners run that quickly, it ought not diminish what the 10 runners have accomplished. If it is necessary to select the fastest runner for a gold medal, that's fine, even though 9 other very fast runners won't take the gold. What is important is the achievement and not the rank. I'm told that those seeking to hire lawyers (and perhaps the same is true of those seeking to hire people with other degrees and majors) rely on rankings. That's dangerous. They should rely on grades, assuming, of course, that the grades reflect what the student has accomplished as against a benchmark. Being number one means only that one has higher grades than everyone else, but it doesn't necessarily mean a person is all that accomplished. Similarly, being number 50 out of 100 doesn't sound all that great, but if the those holding the top 49 spots are supergeniuses, one doesn't necessarily go wrong hiring number 50.

Grades matter. So, too, unfortunately, do ranks. Grading curves distort the evaluation process. Every excuse that I have been given for the use of grading curves comes across as a method to mask a flaw in testing design, scoring, and the setting of benchmarks. To quote someone who is a teacher and who teaches teachers, when she learned I had been appointed to a law faculty, "But you don't have an education degree." "No matter," I replied, "I don't think any of us do." Her response, something to the effect that this was a horrible or at least unsatisfactory situation, rings true to this day, perhaps even more loudly.

Some might argue that "the government" should require institutions of higher education to mandate education courses for their faculty, as is done for most K-12 teachers. I say, no, if institutions of higher learning can't figure that out for themselves and take the necessary steps on their own, they are setting themselves up for long-term failure, measured by the achievements of their graduates. But if the government is not to be the source of pressure, who is? The answer is simple. Those paying the tuition should demand that they get what they pay for, and that includes sensible grading standards, well-designed evaluative tools, and prohibition against changes in grading methods and policies after the end of the drop-add period. Some institutions do follow these best practices. It's time for the rest of them, no matter their rank or reputation, to get on board. The law may not demand it, but common sense, decency, fairness, and truth so require.

It ought not be difficult for people to understand the unpleasant ramifications of failing to file tax returns. It ought to be very easy for lawyers to understand that failure to file tax returns is unwise. It is particularly distressing when the failure arises not from ignorance or negligence but from a deliberate decision to disregard the filing requirement.

In previous posts I have shared my thoughts with respect to particular instances involving attorneys who fail to file tax returns. In Some Aspects of Tax Law Aren't Complicated, which addressed attorneys who allegedly failed to report gross income, I commented,

Despite the not uncommon occurrence of lawyer being indicted for failure to file tax returns, each time such a situation comes to my attention the bewilderment reawakens. Why? By now every attorney should be aware of the filing requirement, should be aware of what happens to those who don't comply, and should take steps to ensure he or she doesn't go down the same unwise path.

In Noncompliant Tax Attorneys Are Dangerous to the Tax System, I described the Tax Court's granting of a motion for summary judgement by the IRS with respect to an attorney who did not file tax returns and who represented at least two other taxpayers who also failed to file tax returns.

The problem extends beyond a small handful of noncompliant attorneys. Even among tax lawyers, the problem is significant. As I noted in Tax Practitioner, Heal Thyself, the IRS reported that 8.5% of tax attorneys failed to file a federal income tax return for the last year before the statistics were compiled. In Just a Mistake?, I commented on a tax lawyer who entered a guilty plea to a charge of tax evasion.

Now comes news that a former partner in a prominent New York law firm has pled guilty to charges that he failed to file New York city and state income tax returns. According to the new release, "As a result of the plea, the defendant will pay $1.5 million in taxes and criminal fines to the city and state and be sentenced to 45 days in jail." But it's worse. About a week ago, the attorney resigned from the bar. How sad. He wasn't a tax lawyer, but surely if he needed tax advice there were tax lawyers in his firm.

It's worse. According to the district attorney's news release, "The investigation also revealed that the defendant signed a document at the request of his law firm in which he represented that he had filed his federal and state tax returns and that he had paid his tax liabilities for the previous year." Could the attorney have thought he filed the returns? Perhaps if one year was in issue, it could have been a matter of a lost mailing, or an envelope that dropped behind a desk or cabinet. But according to the news release the attorney had not filed the city and state returns since 1998, and allegedly since 1982. What isn't clear is whether he filed federal tax returns. Was the attorney in financial difficulty? There's nothing to indicate an answer one way or another.

As I pointed out in Tax Woes for Philadelphia Restauranteur, if the thought of not filing a tax return is prompted by financial difficulties, the course of action is clear:

Each semester I explain to my students that the worse thing to do when in financial trouble is to avoid paying taxes by hiding income. It's better to file a return without paying the taxes. No fraud, no crime. Lots of aggravation, but no jail time.

To that I should add, "No fraud, no resignation from the bar, no destruction of one's career."

Somewhere along the line, law students are told that they have an obligation to file tax returns. Some learn this before they reach law school, and at some point during law school all of them hear it. But are they listening?

What is it that law schools can do to instill in their students a commitment to filing tax returns? I don't know. It's not as though law schools are telling their students not to file. It's not as though law schools are not telling their students the stories of what can happen when tax returns are not filed. It's not as though law schools aren't telling their students that if they get into financial difficulties they should file their returns and request a payment arrangement.

Perhaps sometimes someone's brain just flat out misfires. Perhaps illness causes memory lapses and bad judgment. A lawyer's professional colleagues can help by keeping track, just as the New York attorney's firm asked specifically about the filing of tax returns and the payment of taxes. It is unlikely, though, that illness accounts for years of noncompliance. Sometimes, sad to say, it's an inability to comply and a defiance of law. Those are not good character traits for lawyers to have.

Early in the year I shared my reactions to Governor Rendell's proposal to lease the Pennsylvania Turnpike to a private company in order to generate a temporary surge in cash flow. In Selling Off Government Revenue Streams: Good Idea or Bad?, I asked some questions:

• What happens if the private company wants to raise tolls more often and more steeply?
• Does the length of a lease matter?
• What happens if the private company fails to maintain the road properly?
• And what happens when the road, if leased, is returned to the state at lease end, or earlier, in poor condition? Who pays?
• If the toll roads are such wonderful sources of income for private industry, why can't they be wonderful sources of income for state governments without selling or leasing them?
• Is it simply a matter of toll increases being easier for private industry than for government?
• Rather than sell off public assets, why not impose tolls on other limited access roads that require government expenditure?
• Because tolls are predictable and stable, the idea of selling or leasing toll roads attracts the wheeler-dealers. But is it a good idea? What makes it different? What makes it different is that it's a matter of public trust.
• Once the toll roads, and other highways, enter the private market place, how long until Bill Gates or Walmart ends up owing them? Should citizens be swayed by the promises of quick riches? Will they?

In that commentary, I called for "wide-open, highly publicized debate" even though a careful reading of my analysis discloses my opposition to the sale of the goose that lays the golden eggs. In a follow-up commentary, Are Citizens About to be Railroaded on Toll Highway Sales?, I called for "a referendum at the next election." I noted that polls showed widespread lack of support for the idea of leasing the turnpike.

Shortly thereafter, the governor formally presented his plan to the legislature, and I shared my comments in Turnpike Cash Grab Heats Up. As I had in Selling Off Government Revenue Streams: Good Idea or Bad?, I called for user fees, in the form of tolls, on the major state highways, particularly those in need of repair because of high traffic volume. I mentioned the mileage-based road fee that has again moved into the spotlight, as I described earlier this week in Mileage-Based Road Fees, Again.

The legislature rejected the turnpike lease idea, and instead enacted a toll on Interstate 80, to go into effect next year. Within minutes of its enactment, the provision came under heavy fire from people who want Interstate 80 funded by those who don't use it. Arguing that a toll would hurt businesses and residents near the highway, politicians and business leaders from the area of the state through which the highway runs embarked on a campaign to eliminate the tolls before they go into effect. Two members of Congress from the area introduced legislation in Congress seeking a federal ban on I-80 tolls. It's interesting that residents and businesses near the state's toll roads have prospered, without having the chance to impose the cost of their use of the toll road on people and businesses elsewhere. It is amazing how difficult it is for those with a long-term unfair advantage to reconcile with the idea of giving it up.

So what's a governor to do? Choice one: speak the truth, educate the citizens, point out the equity of asking people who use I-80 to pay for what they are using, show courage in explaining why the I-80 free ride must end, expose the turnpike lease proposal for what it really is, and, of course, risk losing votes and aggravating politicians. Choice two: cave in, let the whining from the free-ride beneficiaries carry the day, open the doors to the vultures waiting to take over the turnpike, and let the majority of the state's citizens end up on the short side of the road cost ledger. Tough choice? Considering that the governor is in his last term, surely maximizing votes in the next election wouldn't affect his decision, unless, perhaps, he has his eye on higher office. There's a clue here for political observers, because the governor, according to this Philadelphia Inquirer story, has revived the turnpike lease proposal.

This time, there are 34 outfits lined up to get in on the big give-away. Let's face it. No private enterprise is going to jump in on this deal unless there's money to be made. Lots of money. And if there's lots of money to be made, that means toll revenue will exceed the payment to the state and the cost of operating the turnpike. Would it not make more sense for the state to retain control and follow one of two alternatives? Yes, it would. The state could charge the tolls that the private company would charge, and use what would be the profit to fund road repairs. Or the state could reduce the tolls to an amount necessary to cover the cost of operating the turnpike, so that drivers aren't contributing to the profits of some cash grabber.

The boondoggle implicit in the proposal is readily apparent from an analysis of the "suitors" seeking to become the turnpike lessee. Almost all are financial enterprises, management companies, and engineering firms. Among them are several toll-road management companies, who somehow think that they can extract money that the Turnpike Commission hasn't found. In other words, if they take over, expect huge toll increases, not to fund public highways, but to line the pockets of shareholders and highly compensated company officers. One of these companies is from Australia. Another is from Spain. Is there some sort of shortage of Pennsylvanians capable of managing toll roads? These two companies, by the way, jointly leased the Chicago Skyway and the Indiana Toll Road. Recently I was on the latter road. Unlike 2005, E-Z Pass no longer is available. Drivers must sit in a queue to collect a ticket and to pay a toll. This is an improvement? What nonsense. Some folks in Indiana just got raked over by the slick sales pitches of these "management" companies, whose claim to the word "manage" is that they manage to take cash and time from drivers on the Indiana toll road.

What makes an investment firm qualified to operate a toll road? These money handlers seeking to dip into the turnpike's revenue stream include groups from Canada, India, and Switzerland, and several from elsewhere in the United States. Again I ask, is there no one in Pennsylvania capable of operating the turnpike? Maybe the good news is that people in Pennsylvania aren't experts in the smoke-and-mirrors dance that characterizes the "lease to private enterprise" gimmick. Perhaps the Defense Department's experience in leasing out government functions to Blackwater has a lesson for the Pennsylvania legislature?

Take a look at the list of enterprises trying to get in on this cash cow deal. It's in the the Philadelphia Inquirer story. Will Pennsylvania Turnpike users be better off if the road is managed by Citi Infrastructure Investors, or the Canada Pension Plan Investment Board? How about AIG Financial Products Corp. or HH Capital Advisors? Perhaps JE Jacobs or Merrill Lynch bring years of toll road management experience to the table? Think of all that Transurban USA Inc. or UBS Investment Bank Infrastructure Fund could do to fill potholes.

Folks, these companies exist to make money. The only way they can make money is to charge tolls that are higher than the sum of the cost of operating the turnpike plus the amounts advanced up front to the state. In substance, these companies are lending money to the state and charging the equivalent of interest at astronomical rates. Their presentations are slick, but not unlike those made to any other entity or person in need of a quick cash fix. Pennsylvania can do better than to mortgage its future and sell off the well-being of its citizens.

Two months ago, a bridge carrying an Interstate Highway over the Mississippi River in Minnesota collapsed, killing more than a dozen people and causing tens of millions of dollars in economic damage. Considering that the bridge was carrying heavy traffic, it is amazing that the death toll wasn't much higher.

From that tragedy came at least one lesson. This nation had best repair its infrastructure, particularly highways and bridges. The catch? The repairs cost money. Where will the nation get the money it needs for this task?

That the repair task needs to be accomplished isn't debatable. Bridges, highways, and other infrastructure is deteriorating quickly as maintenance is deferred, as traffic loads increase, and as highway funding decreases in inflation-adjusted dollars. It doesn't take Einstein to do the math, or the physics. It makes far more sense to spend a dollar today to prevent future loss than it is to do nothing and encounter thousands of dollars of loss, to say nothing of injuries and deaths, a month, year, or decade from now.

So what's the problem?

As best I can tell, it's a matter of more politics and ignorance, with some incompetence tossed in for flavor. Perhaps there is some greed in the mix, because the notion of paying for what we use appears to be heresy to some people simply because they don't want to pay.

According to a story from almost a month ago, Rep. Oberstar, DOT's Peters Split on Funding Plan, a Congressional proposal to increase the gasoline tax to fund what clearly are necessary repairs has run into opposition from the Administration. The proposal calls for a 5-cent per gallon tax, a relatively small amount when compared to the cost of gasoline. The plan includes other provisions, but I will leave those administrative and engineering questions to others, at least for the moment.

I am baffled by the response from the Transportation Secretary Peters:

It makes no sense to my mind to raise the gas tax at a time when we are rightfully exploring every conceivable mechanism to increase energy independence and clean our air, promote fuel economy in automobiles and stimulate the development of alternative fuels as well as reducing emissions.... We should be encouraging states to explore alternatives to petroleum-based taxes, not expanding the country's reliance on them by increasing the gas tax.

Why would raising the gasoline tax pose a problem to the process of searching for alternative energy? Would it not, in fact, encourage that process by making the alternatives appear less costly compared to gasoline? Does not an increase in the tax on gasoline, like the imposition of a tax on any product, cause demand to fall? Consider the opposite: reducing taxes on, or subsidizing a product, which would increase demand.

Perhaps the Secretary's last sentence suggests a preference for some other sort of highway and bridge funding. As I noted in Monday's Mileage-Based Road Fees, Again, it probably makes sense to replace the gasoline tax with a mileage-based highway use tax. But until that approach is ready for prime-time, and it's not, the nation needs to ride the funding source that is in place.

But more recently, according to Boxer, Peters Clash Over Bridge Safety, the Transportation Secretary told the Congress, "The answer is not to spend more. It is to spend more wisely." This perspective makes sense only if it can be demonstrated that highway transportation funds are being wasted, stolen, or embezzled. It doesn't make sense to argue that money currently spent on highways should be shifted to bridge repairs, because we'll next be reading about 30 vehicles falling into a sinkhole.

In the meantime, we're told in Bush Opposes Raising Gas Tax for Bridge Repairs that the President responded to the proposal by saying, "Before we raise taxes, which could affect economic growth, I would strongly urge the Congress to examine how they set priorities.” I have a news alert for the President. Failure to fund infrastructure repair, sooner rather than later, also will affect economic growth. When enough bridges collapse and highways fall apart, the trucks won't be moving products, such as fuel, food, clothing, and, yes, even military supplies. If you think that won't affect economic growth, you don't understand economics.

Better yet, take a lesson from the governor of Minnesota. According to Bridge Collapse Revives Issue of Road Spending, during the past two years the governor of Minnesota twice vetoed increases in the state gasoline tax intended to pay for transportation needs. Reportedly, he is now reconsidering his position and his approach to these issues.

In all fairness, the current mechanism for allocating gasoline tax receipts needs to be purged of politics and linked to need. Somewhere along the line, members of Congress gave themselves the right to specify that certain portions of the fund get used for specified projects. These designations often failed to reflect need, but instead caused construction of multi-lane highways in rural areas, bridges to nowhere, and interchanges used by few vehicles. To make matters worse, some highway transportation funds were diverted to other uses. Bicycle and pedestrian paths were funded, whether or not demand existed. New public transportation developments in sparsely populated areas were constructed, while existing and heavily-used public transit systems continue their shoestring operations.

The problem with rejecting tax increases until the funding allocation system is fixed is that more people will die, more people will be injured, more property damage will occur, and more transportation bottlenecks will stifle the economy while Congress wiggles and squirms and the Administration and politicians wave slogans in the voters' faces. "No tax increases" sounds great until one realizes it's not unlike the "No more spending" family budget vow that looms in the way of paying for the baby's food. Perhaps "No more unnecessary tax increases" would resonate with those whose ability to analyze economic problems goes beyond three-word sentences.

The fact that I, like most others, do not like taxes does not mean I will reject them when they are necessary. It would be better, and easier, to talk about "user fees" because that's what the federal gasoline tax and the proposed mileage-based road fees are. Properly structured, set at a price that reflects the true cost of building and adequately maintaining a highway, bridge, interchange, or other facility, these user fees would not only move the debate from the silly place it now occupies but also would make the prospect of additional bridge collapses and road failures the highly unlikely outcome most people thought was the case.

Any other approach does not bode well. Paying for repairs with borrowed money increases the nation's debt load, making it more likely that the foreclosure will destroy the country. Ignoring the problem and not spending money guarantees death and destruction on a far larger scale. Abandoning the infrastructure simply hastens the demise of the economy and ultimately the country. Unfortunately, the time has come to pay the price for so many bad transportation infrastructure decisions during the past 50 years. The even more unfortunate aspect of the matter is that most of those who made the bad decisions aren't around to see the consequences of their vote-pandering and ignorance or to deal with the consequences. The only good part of this is that voters will have a chance to ensure that those bad decision makers still around are deprived of additional opportunities to make a mess of things.

Larry Staton, who has been reading MauledAgain for almost as long as it has existed, has passed along another tip that not only is enlightening but timely. Larry referred me to a USA Today article, Drivers Test Paying by Mile instead of Gas Tax. The article explains that beginning early in 2008, six states will permit selected drivers to test a system that imposes road use fees based on mileage in lieu of a gasoline tax based on gallons consumed. In the experiment, drivers will continue paying the gasoline tax and receive hypothetical invoices for the amounts that they would have paid under the mileage-based fee. This will permit them to make comparisons and determine which approach was costlier to them. The people running the experiment want to get information on how people would react if this system were in place. In addition to this six-state experiment, several other states either have conducted their own experiments or are making plans to have appropriate state agencies conduct them.

I discussed the mileage-based road fee in Tax Meets Technology on the Road, in which I described both the advantages and disadvantages of the mileage-based road fee. Ultimately, I came out in favor of this approach. One of the potential disadvantages, government acquisition of information about where a driver has been, turned out to be a non-issue in Oregon's experiment. It's interesting to note that a concern of such significance to academic theorists turned out to be unimportant to 91 percent of the experiment participants. As I noted in my post, it was not an issue for me because nothing in that sort of information about my driving would be of interest to anyone, and it might come in handy if I needed to prove I was not in some place.

The issue is timely because some states are contemplating raising existing highway tolls and/or imposing tolls on currently toll-free highways. In Pennsylvania, a debate is raging over the proposal to make the Pennsylvania portion of I-80 a toll road. I'm planning to discuss that issue in greater detail as the story develops. The discussion, at least to date, appears to omit analysis of the critical component, namely, assignment of highway costs to those who generate the need for governments to pay those costs. The mileage-based road fee, especially one that reflects vehicle weight, is, if nothing else, much more equitable.

My only gripes are that the experiments should be much more inclusive, and that they should be in place for shorter periods of time. There's much more to be learned by trying the experiment in two or three dozen, or all, states rather than six. In all fairness, those running the experiment may have funding limitations. The experiments should provide the requisite data in a period shorter than the planned two years, and if the date can be accumulated in one year, replacement of the gasoline tax with the mileage-based road fee would be one year closer.

As pointed out in the USA Today article, it seems inevitable that the gasoline tax will be set aside in favor of mileage-based road fees. The advantages of the latter far outweigh the disadvantages. The reasons for making the change are compelling, and, in this instance, the sooner, the better.

This is about a month late, but fortunately I remembered it when it popped up when I googled my full name the other night. So it was moved to the front of the "waiting to be blogged" line.

In the year since I posted Maule on Legal Education, 2006 Edition, another column has been added to the list. That's pretty much the norm, especially because there are only so many Gavel Gazette soapbox spots available and I ought not appropriate more than my share. Of course, the powers-that-be aren't going to let me turn the front page of the law school newsletter into my own weekly column.

So, once again, here are the links, in chronological order (and with the latest URLs, which again were changed):

Money for Nothing and Work for Free?, The Gavel Gazette, at 1 (March 5, 2001)

Crumbling Myths & Dashed Expectations, The Gavel Gazette, at 1 (Sept. 3, 2002)

Learning to Teach and Teaching to Learn, The Gavel Gazette, at 1 (Sept. 29, 2003)

Time CAN Be on Your Side. Or at Least by It, The Gavel Gazette, at 1 (Feb. 16, 2004)

Doing Puzzles While Learning & Practicing Law, The Gavel Gazette, at 1 (Sept. 20, 2004)

Up All Night = Grades Go Down, The Gavel Gazette, at 1 (Nov. 7, 2005)

Thinking About Thinking, The Gavel Gazette, at 1 (Feb. 5, 2007)

No matter how busy a first-year student thinks he or she is, the few minutes invested in reading these short essays and grabbing the free advice in them will provide worthwhile payback in the form of countless hours saved from using more efficient study habits, from figuring out how to allocate time, and from avoiding mistakes that require investment of additional time to remedy. These essays have been republished in other media, at least two have been reprinted, several have been quoted, at least seven law faculty at other schools distribute one or more of them to their first-year students during orientation or the first week of class, and collectively they have been cited at least several dozen times.

Yes, the eighth in the series is taking shape.

Few people like to pay taxes, even if they're receiving more from the government than they're contributing, and even fewer like to experience a tax increase. So it's no surprise that the tax reform group, Philadelphia Forward, has urged all Philadelphia real property owners to file appeals in response the city's reassessment of their properties for real property tax purposes.

Philadelphia Forward advocates use of full market valuation for property tax purposes, something that the city of Philadelphia does not use. Under full market valuation, properties are assessed at full fair market value, and the tax rate is applied to that assessment. The advantages of full market valuation include fairness, ease of determining whether properties are being properly assessed, and logical correlation between taxation and value. The disadvantage is that costs money and takes time to pin a fair market valuation on each property.

Citing the Clifton case that I discussed a few months ago in An Unconstitutional Tax Assessment System, Philadelphia Forward explains that Judge Wettick found that "Using income tax terminology, one out of every four Philadelphia property owners was in a tax bracket of at least 3.35% and one out of every four property owners was in a tax bracket that did not exceed 1.42%." It also notes that

The Philadelphia Tax Reform Commission established that: "Philadelphia’s property assessments do not meet industry standards for accuracy; all across the city, assessed values diverge widely from market values. Philadelphia’s property assessments do not meet industry standards for equity; properties in poorer neighborhoods are, on average, assessed at a higher percentage of market value than properties in more affluent neighborhoods. The inaccuracy and regressive nature of Philadelphia’s assessments violate standards of vertical and horizontal equity."

A map of the disparities in effective rates gets the point across in a strong visual way.

It's more complicated than just convincing city officials to value properties at fair market value rather than at some other amount determined in some way that isn't very clear or obvious to homeowners or taxpayers. The people who make the assessments have no authority to set or change the tax rate, so if the assessments are established at fair market value, most property owners in the city would experience whopping tax increases, and the city would experience a surge of tax revenues.

The determination of how much property tax revenue the city should collect is a question separate from determining how that tax should be apportioned among property owners. The first question is part of the larger issue of establishing city spending, the scope of services provided by the city, and related matters such as public employee retirement and other benefits. The second question has been answered by the state Constitution and judicial decisions, including that of Judge Wettick in Clifton. Property taxes must be assessed uniformly. Someone who owns a property worth twice the value of a property owned by a second person should pay real property taxes twice the amount imposed on the second person.

Because determinations by two different components of city government establish a property owners' real property tax, those two components need to sit down together and map out a plan under which properties are assessed at fair market value, and the rate adjusted so that the overall tax revenue is unchanged. Thereafter, if the city wishes to increase revenue, it can do so using the process for increasing the real property tax rate, in a way that is transparent and provides taxpayers with an opportunity to comment on the wisdom or folly of such an increase.

As it presently stands, the so-called reassessments not only would fail to bring uniformity, they also would trigger a tax increase. I'm not sure what would happen to the assessment appeals system if all 400,000 property owners take the advice of Philadelphia Forward and appeal, but we may be finding out soon. On the Philadelphia Forward web site are instructions for filing the appeal, and the organization pledges to assist property owners and accompany them to hearings.

The system needs to be fixed. I have a sense things will become more complicated and frenetic before they are resolved.